Articles Posted inClass-Action

The war for data rages on as companies continue to mine their customers’ data and their customers continue to sue them for it.

The latest data-related lawsuit was filed last month against Casper, a direct-to-consumer startup that makes and delivers mattresses, on behalf of visitors to its website. According to the class action lawsuit, Casper used a software company called NaviStone (which is also listed as a defendant in the lawsuit) to collect personal information from visitors to the Casper website, including the visitor’s name, address, IP address, and their online shopping habits, including keystrokes and mouse clicks.

The lawsuit alleges NaviStone’s code (which Casper uses on its website) begins transmitting information about the individual as soon as they load the Casper website onto their browser, without the individual’s knowledge or consent. That meant information that visitors put into forms on Casper’s website went directly to the company, regardless of whether the person ever finished filling out the form or hit the “Submit” button.

The lawsuit alleges the violation amounts to wiretapping and is suing both companies under the federal Wiretap Act and the Electronic Communications Privacy Act. Continue reading

Bitcoin has been all the talk by way of investors and the question arose this week when prices dropped as to the legality of a Bitcoin exchange shutting down when prices were falling. It is alleged that trade halts were made for a period of two hours. The price drop was rather substantial from $20,000 to $11,000. It is said that the outage was for reason of technical difficulties and not intended to rescue the currency from free-falling, as the legality of doing that would be questionable. In fact, it is illegal for trading to be put to halt without following the Securities and Exchange Commission’s guidelines. Foreign currency exchanges are less regulated, and the for such reasons there are increased risks for loss, malfunctioning trading systems, and fraud.

Some even speculate that Bitcoin exchanges may stop completely if much fraud, technical difficulty, glitches or hackers and/or malware become common. Legal precedent set in this area of law is rare, though civil litigation in this area has started. The stoppage has certainly started lawsuits claiming damages. Mt. Gox, a bitcoin exchange in Tokyo, collapsed after it halted withdrawals and eventually conceded that its holdings, worth approximately $65 million at the time, had been stolen by hackers.

The site also came under great scrutiny for possible “insider trading” among its employees before the site started to support Bitcoin Cash, a fork of the Bitcoin project. CEO Brian Armstrong pledged that the company will investigate those allegations internally.

In a previous decision in around late August, a federal judge ordered the return of 11,000 bitcoins worth about $30 million in a decision considered the first of its kind. The ruling stemmed from a class action in which plaintiffs alleged that the defendant had stolen their money and fled to China. The judgment highlights the decentralized nature of bitcoin, with no person or authority in charge. It makes it difficult for winning plaintiffs to get their bitcoins that they are entitled to back. Continue reading

The argument between The Trump National Golf Club Jupiter and a class of 65 former members continues as the golf club has asked the Eleventh Circuit Court to overturn a ruling by the lower court that requires the golf club to pay approximately $5.7 million in refunded deposits to the former members.

The argument appears to hinge on when the members actually resigned their golf club membership. Prior to Trump’s purchase of the golf club, members paid a deposit, which was to be refunded to them upon the resignation of their membership. But the golf club was having financial troubles and was unable to pay all the resigning members their deposits.

So the club formed a resignation wait list, in which members who wanted to resign could continue using the golf club’s facilities as long as they continued paying their dues. When they reached the top of the list and enough new members had joined (generally five new members for each member on the resignation waitlist), the resignation could be made complete and their deposit refunded to them. Continue reading

It may be a first when class-action consumer litigation requires a Seventh Circuit panel to describe the step-by-step process of creating a Subway sandwich in a published opinion.

But that’s indeed what the court did in its recent ruling dismissing a class-action suit against the Subway fast-food chain; ham, provolone, pepper jack and all.

It all started in 2013 when an Australian teenager posted a photograph of his Subway “Footlong” sandwich next to a tape measure on his Facebook page. The sandwich measured only 11 inches. The post went viral and Subway customers in the U.S. began measuring their own sandwiches, and it was only a matter of time before the plaintiffs’ bar got in on the action.

Plaintiffs’ lawyers sued Subway, seeking damages and injunctive relief under state consumer-protection laws. The different cases were consolidated in the Eastern District of Wisconsin.

Subway’s defense was that because of deviations in the baking process, some rolls would inevitably shrink to under 12 inches, but all customers still received the same quantity of ingredients and most customers still got to enjoy a foot-long sandwich. Continue reading

Even those of us who have come to terms with the fact that companies and advertisers track everything we do online aren’t ready to compromise their children’s privacy. In fact, the Children’s Online Privacy Protection Act (COPPA) is a federal law that was put in place specifically to do exactly what it sounds like: protect the privacy of children when they’re online.

But Disney, along with some of its software partners, allegedly violated this law by embedding trackers in some of the entertainment company’s most popular apps that tracked users’ information and allegedly distributed it to other companies and advertisers. As an entertainment company that primarily targets children, many of the users whose information is being tracked and disseminated are children aged 13 and younger.

The lawsuit lists dozens of popular Disney apps, including Cars Lightening League and Maleficent Free Fall, that, once downloaded, allowed the trackers embedded in the apps to collect the information and then extract it from the smart devices so it could be disseminated for commercial purposes – all without the knowledge or consent of the children’s parents, the lawsuit claims.

According to Jeffrey Chester, the executive director of the Center for Digital Democracy, Disney should not be using the software companies listed in the complaint. He says they involve heavy-duty technologies designed to track and monetize information on people, and as such, should not be working with a company that targets young children. Continue reading

The bait and switch tactic of selling goods and services is a trick as old as time, but it’s not always legal. If a customer signs a contract agreeing to pay a particular price for something, it is expected that the price will not change for the duration of the contract, unless both parties agree to the change in writing. That change can happen, either as an amendment to the contract, or as part of a new contract.

According to a federal class action consumer lawsuit that was recently filed in California, Comcast allegedly lured new cable customers with promises of low rates, which they then jacked up without warning or gaining consent from their customers. The fees in question are: the “Broadcast TV Fee,” which allegedly went from $1.50/month in 2014 to $6.50/month in 2016; and the “Regional Sports Fee,” which allegedly went from $1/month in 2015 to $4.50 in 2016.

When customers complained to Comcast, they were allegedly told by company representatives that the fees were government-related taxes or fees over which the company said it had no control – an assertion the plaintiffs claim is a blatant lie.

Comcast asked the court to dismiss all the claims put forth by the plaintiffs, saying its online order submission process was not enough to constitute a legally-binding contract. On the other hand, the Subscriber Agreement and Minimum Term Agreement were binding contracts in which the customers had allegedly agreed to pay Comcast’s fees.

Judge Vince Chhabria, of the U.S. District Court of Northern California, rejected Comcast’s motion to dismiss, saying that, by submitting their order, Comcast customers were agreeing to pay Comcast’s advertised prices, in addition to government-related taxes and fees. Chhabria denied Comcast’s assertion that consumers agreed to its higher fees in the Subscriber Agreement. As far as the Minimum Term Agreement was concerned, the plaintiffs allege they never saw it when submitting their order, in which case they cannot be bound by its terms. Chhabria said the plaintiffs had plausibly asserted that they never saw the agreement, although determining it in fact will have to be left to the more in-depth analysis of a summary judgment. Continue reading

It’s hard to see how a children’s clothing store could be a competitor for a brand that sells high-end men’s and women’s clothing. But that’s allegedly what Trunk Club told a former employee who wanted to go to work for Mac & Mia, which Trunk Club said would be in violations of the non-compete agreement she had signed with them.

A subsidiary of Nordstrom’s, Trunk Club is a personal styling service for men and women, while Mac & Mia uses personal stylists to help sell children’s clothing. Molly Dowell worked as a personal stylist at Trunk Club for about six months before leaving, citing concerns about the future of the company. Nordstrom’s recently reduced Trunk Club’s value to half of what the clothing giant paid for the personal styling company, saying it had not been performing as well as Nordstrom’s had hoped it would. That, combined with the recent departure of Trunk Club’s CEO, suggests Dowell’s concerns for the company may have been well-founded. Continue reading

In an age where people are paying and utilizing services online, a certain standard which is regulated by law and expected by clientele needs to be met. That is why when a man from Illinois has decided to sue an online service for paying monthly fees for a service which he is claiming had multiple inactive or dead profile accounts.

In the complaint which is filed in a Federal Court, the service repeatedly asked him pay between $9.99 and $19.99 per month to connect with users who “liked” his profile after the creation of a free account, upon which, he immediately began receiving messages from other users who had supposedly liked his profile. To learn the identities of those who had liked his account, however, the plaintiff was prompted to pay for a premium, or “A-List,” service. The plaintiff alleges that right after the payment of $44.99, he knew something was amiss. Shortly thereafter, upon reviewing the profiles of individuals whose identities were previously hidden, the plaintiff allegedly discovered that most if not all of these people were associated with inactive or ‘dead’ accounts, making interaction or dating impossible.

It is alleged that the actions constitute a breach of contract and violate both the Illinois Dating Referral Services Act and the Illinois Consumer Fraud and Deceptive Business Practices Act with potential to seek class-action status. Continue reading

Shortly after having paid a total of more than $300 million in fines and settlement payments for allegedly opening fake accounts for its customers without their knowledge or consent, Wells Fargo is once again back in the spotlight for allegations of fraud.

This time the allegations are in regards to the bank’s auto lending business, which allegedly signed up and charged customers for car insurance they may or may not have needed or been made aware of. According to the class action lawsuit, most of the approximately 570,000 customers involved were not looking for a car loan from Wells Fargo, but got one anyway after they had chosen an automobile.

Wells Fargo required borrowers to maintain comprehensive car insurance, like almost any other auto loan company. Unlike other auto loan companies, Wells Fargo allegedly bought insurance for its customers who did not have comprehensive insurance, then charged them for it. Wells Fargo even admitted to buying insurance for customers who already had coverage.

National General has also been named as a defendant in the lawsuit, as it is the company from which Wells Fargo purchased insurance on behalf of the customers it deemed were underinsured (whether they were or not). The bank then charged their customers for that insurance, regardless of whether those customers could afford the insurance Wells Fargo had bought for them.

Many of the customers who were forced to pay for auto insurance they could not afford fell behind on their payments, to the point where some were forced to default on their loans, resulting in the repossession of their vehicles. Continue reading

The Seventh Circuit has again rejected a pick-off attempt in a class action overturning a dismissal that approved use of that tactic.

Just because someone offers to make a payment to settle a legal dispute does not mean the payee is required to accept the payment. Nor does the offer of payment (or deposit made to the court) negate the existence of the legal dispute. Nevertheless, that’s exactly what Bisco Inc. tried to claim after Fulton Dental, LLC filed a putative class action lawsuit against the dental company.

Fulton sued Bisco for allegedly violating the Telephone Consumer Protection Act (TCPA) by sending unsolicited fax messages about dental products. Fulton sued on behalf of itself and all those similarly situated who received unsolicited fax messages from Bisco (for which Fulton was therefore made to pay). But before Fulton had a chance to file a motion to certify its class of plaintiffs, Bisco offered to pay Fulton about $3,000 in order to settle the dispute. Fulton refused, but Bisco made a deposit to the court of $3,600 and claimed that settled the whole matter.

The Seventh Circuit Court disagreed, going off the Supreme Court’s 2016 in Campbell-Ewald, in which the Supreme Court rejected the assertion that an offer to pay the plaintiff’s damages in full did not render the class action lawsuit moot under Rule 68 of the Federal Rules of Civil Procedure.

However, in its written opinion, the Supreme Court did note that, by making the ruling in this particular case, the Court was not trying to rule in any other legal disputes of a similar nature. Bisco took that to mean the deposit it made to the Seventh Circuit Court of Appeals was still a valid method of ending its legal dispute with Fulton Dental. Continue reading